Social Responsibilities

Social Responsibilities

Nurturing Talent and Contributing to Society

Empowering and investing in our employees has always been the core of our culture and values. We recognise that they are the driving force behind our ongoing innovation and success. At Xtep, we highly value our employees and strive to create a diverse and inclusive workplace where our talents can thrive.

The Group demonstrates our unwavering commitment to the communities where we operate by actively supporting charitable initiatives through in-kind, monetary donations and encouraging employee volunteering. By actively engaging in these endeavours, we aim to make a meaningful and lasting impact on the community we serve.

Supporting the Growth and Well-Being of Our People

We recognise the essential contribution of our employees to the Group’s continuous and sustainable growth. The Group’s staff management practices focused on attracting and retaining talents by offering competitive compensation and extensive training opportunities and fostering a caring and supportive culture. Our commitment is to create a safe, positive, and talent-nurturing work environment where our employees are empowered to leverage their strengths and pursue their potential with equal opportunities.

Staff portfolio

Highly skilled and talented employees form the foundation of the Group’s long-term growth and success. As of 2023, we had approximately 9,100 employees and the breakdown is as follows.

Talent retention

The Group adheres to the “Labour Law of the People’s Republic of China” and the “Labour Contract Law of the People’s Republic of China”, ensuring that recruitment and employment practices are conducted fairly and consistently. Our comprehensive Staff Handbook can address key issues such as compensation and dismissal, recruitment and promotion, working hours, rest periods and so on to foster equal opportunities within the workplace. This year, our employee turnover rate is 27.4%, which remains below our target rate of 30.0%, supporting our long-term goal of retaining talent3.

We have implemented a salary and benefits system that is fair and competitive. Employee remuneration is determined by considering factors such as qualifications, experience, job scope, performance, and prevailing market conditions. To ensure that our compensation remains attractive, the Group goes beyond the minimum wage requirements and regularly assesses market salary data to ensure the reasonableness of our compensation packages. In addition to basic wages, we have introduced an employee stock incentive plan designed to incentivise and reward long-term career growth within the Company.

The Group has implemented a robust performance management system to assess employee performance and make informed decisions regarding promotions and salary adjustments. This system incorporates scheduled discussions where employees receive valuable feedback from their supervisors. Promotions and salary adjustments are based on documented appraisal results, with exceptional performers eligible for additional bonus incentives. Additionally, we conduct regular talent reviews to identify areas for improvement and recognise high-potential employees within the Group.

To improve operational efficiency and foster employee productivity, we have established a Staff Position Management System that clearly defines each position’s grade, title, and responsibilities. We have also updated our recruitment management system and internal transfer process, which enhances talent retention and improves the procedures of our recruitment process.

Child and forced labour

The Group’s dedication to labour rights and standards cultivates a work environment where all employees feel supported, respected, and able to perform at their best. Our Staff Handbook also includes policies against child and forced labour, along with other welfare and benefits information. This handbook outlines our commitment to maintaining an inclusive and transparent workplace and safeguarding our employees against discrimination due to gender, age, ethnicity, nationality, marital status, religion, etc.

Consistent with our commitment to ethical practice, the Group strictly prohibits the use of child and forced labour across all operations to comply with relevant laws and regulations. To enforce this, we have rigorous checks and controls during the hiring and onboarding processes to prevent the employment of underage individuals. We also conduct regular reviews of our employment practices to ensure fairness and legality. During the reporting period, we were not aware of any material non-compliance with laws and regulations regarding labour standards.

Our commitment to ethical labour practices extends beyond our own operations to also include our supply chains. We evaluate both potential and existing suppliers on their adherence to basic labour rights, as well as the standards of accommodation and food services they provide to their employees, as part of our effort to uphold the legitimate rights and interests of all workers. In 2023, we did not observe any incident of child or forced labour during our supply chain evaluation exercises.

Labour health and safety

Protecting the health and safety of our employees is our top priority. This year, we have completed and passed the recertification for the ISO 45001:2018 Occupational Health and Safety Management System (OHSMS), which we use to manage and reduce occupational health and safety risks. The Group also complies with relevant standards, laws, and regulations and has developed standard operating procedures, working guidelines, and manuals to guide the work procedures and processes.

Our proactive approach to occupational health and safety is multi-faceted, reflecting our unwavering pledge to provide a safe work environment. We have targets, standardised procedures, and emergency response plans for identified risks to promptly eliminate potential safety hazards. We also conduct regular reviews of our Occupational Health and Safety Management System to ensure the effectiveness of our preventative strategies and corrective measures are applied appropriately.

The Group has established an Occupational Health and Safety Committee responsible for reviewing and regularly reporting on health and safety performance. Each shift has a professional health and safety officer present to inspect whether frontline workers comply with our safety procedures during the production process. All workers also receive a safety briefing at the start of each shift and a debrief at the end, reporting any potential safety hazards observed during the shift. This practice serves as an effective routine reminder to remind employees to maintain a safe working environment. The billboards and LED display screens we have installed in the office and factory enable employees to stay informed about the latest laws and regulations related to fire safety, food safety, and workplace safety.

We have consistently maintained and repaired our fire safety equipment and conduct regular and surprise inspections of personal protective equipment. Special equipment, fire-fighting appliances, monitoring systems, and machinery are routinely maintained and upgraded to provide workers with the required protective gear. Additionally, we conduct an evaluation of the current occupational hazards in our facilities and operations every three years, and yearly inspections are performed to identify occupational risks. Through these regular evaluations and yearly inspections, we identify any safety concerns in our working environment and ensure compliance with standards regarding potential occupational hazards. There was no major safety risk identified in the assessment during the year.

The Group has also introduced intelligent production equipment, such as automatic cutting and computerised sewing machines, to minimise occupational risks during production. For any potential risks, the Company has formulated Safety Plan Management Regulations and Emergency Plans, handling possible accidents according to the “No neglect” principle.

We are not aware of any non-compliance with laws and regulations in 2023 that had a significant impact on the Group with respect to occupational health and safety. Of the 33 work-related injuries that occurred within the year, the majority were commuting accidents that happened during the journey to and from work. All cases have been reported to the local authorities for occupational injury assessment and follow-up action.

Employees’ health and wellbeing training

To maintain a high level of health and safety awareness, we regularly conduct emergency drills, enabling our staff to respond appropriately to any incidents, enhancing their preparedness, and identifying potential shortcomings in our emergency plans. We also provide work safety and injury prevention training to new joiners, internally transferred employees, and return-to-work staff to ensure they are aware of the potential workplace hazards. Our management team also collectively analyses accident cases to identify the reasons for happening and establish preventative measures. This year, we also conducted additional occupational health assessments for workers in special positions.

In addition to occupational health and safety, we are committed to supporting the health and wellbeing of our employees. The Group provides employees with complimentary health checks annually to identify potential health issues and boost employee morale in the workplace. To enhance their overall wellness, we have launched health awareness training programmes to provide health tips such as cold prevention and emotional management.

Training and development

Supporting our employees and helping them advance their skills is an important part of our efforts to build a strong and productive workforce. The Group focuses on the enhancement of training and development initiatives that enable our employees to strengthen skills and foster their adherence to our corporate values.

By exploring various training programmes as fuel, our Xtep Talent Centre is the key engine of the growth and advancement of our employees which provides an extensive selection of courses to enhance our staff’s proficiency and productivity. It comprises specialised training courses and an online training platform to tailor professional development programmes to ensure targeted and effective skill enhancement. In 2023, our online training platform has recorded 3,533 active learners.

The training courses offered by our Xtep Talent Centre can be categorised into two types as below:

Furthermore, we have strengthened our collaboration with educational institutions, actively developing fresh and specialised talents through campus recruitment and social recruitment in order to continuously provide an excellent talent pool to support the Group’s development strategy. Throughout the year, our ongoing collaboration with the Beijing Institute of Fashion Technology and Jiangnan University has continued to cultivate talents in the footwear and apparel industry. We will keep engaging with educational institutions proactively to identify and attract promising candidates with the skills and potential.

Key training programmes in 2023

The Navigator Programme
The Navigator Programme develops the leadership skills of mid-level and senior management within the Company, aiming to accelerate practical experience in their roles and enhance their leadership qualities. The Programme is structured in four components: course-based training, discussions on business topics, post-course assessments and the development of a leadership mindset. Through a combination of classroom learning and performance evaluation, the Programme helps participants develop competencies in key areas such as strategic planning and operational management.

The Pacesetter Programme
The Pacesetter Project primarily involves inviting trainees to share their stories on special topics. After the offline session, learning is further disseminated within each department. Trainees are required to conduct internal training within their own departments or conduct workshops integrating with actual business operations, which are set up as projects on the Xtep online training platform “Tezhihui”. We also organise various group-based activities to enhance team cohesion, explore corporate culture and reinforce our core values.

The Career Accelerator Programme
The Career Accelerator Programme serves as a knowledge exchange platform that facilitates the sharing of professional insights within and outside the organisation. By linking operational knowledge across front, middle and back office functions, we seek to strengthen experience transfer and empower employee growth.

This year, the Programme featured 11 online and in-person courses delivered by instructors who are top performers, trainees and industry experts. A total of 3,347 attendees participated in the courses, with an average annual course satisfaction rating of over 92%. The Career Accelerator Programme will continue synergising functional expertise to reinforce organisational excellence and maximise knowledge circulation in support of career development and organisational objectives.

Alignment Programme for Shared Core Values
To embed the Group’s core values across all levels, we have launched the Alignment Programme for Shared Core Values. It begins with soliciting input from key leaders to identify the shared values. These values were then formalised into a set of guidelines.

Subsequent activities work to embed and promote the values in day-to-day operations, such as empowering certain employees as cultural ambassadors, hosting in-person workshops across offices, and developing online learning modules. Short videos and memos from executives, as well as 7 curated stories and 20 case studies focusing on “perseverance”, “innovation”, “integrity”, and “collaboration”, further brought the values to life across the Group. By employing a multidimensional approach, this Programme has made progress in culturally aligning all staff with the shared vision and values.

Employee’s engagement, leisure and welfare

We are dedicated to the holistic well-being of our employees. From expanded benefits to empowering culture initiatives, our goal is to create a supportive environment where people can be their best selves both at work and beyond.

To boost employee wellness and morale, we have expanded our employee welfare initiatives by enhancing our existing benefits like statutory insurance, paid leave, and regular medical checkups. We have also upgraded our staff canteen offerings to include diverse nutritious and delicious meal options. As part of nurturing a supportive corporate culture, we have launched “Sunshine Sharing” sessions for employees to share inspiring stories to celebrate achievements and foster belongingness. Demonstrating our dedication to employee well-being and engagement, we have established various interest clubs to cultivate a running culture.

We host celebrations on occasions like International Women’s Day, Labour Day, and other family-centric dates, such as Mother’s Day and Father’s Day. Through these events, we recognise the diverse roles our employees play both on the job and in their personal lives. By acknowledging their responsibilities, we aim to foster a supportive environment where work-life balance is valued. We also present birthday gifts to our employees to strengthen bonds with them and reinforce our commitment to a supportive culture. To help our employees weather unexpected financial difficulties, we created an Employee Mutual Fund that provides financial assistance during hard times. This fund helps alleviate employees’ stress so they can dedicate their efforts to their work, assured that basic needs will be covered if unforeseen circumstances arise.

Diversity, equity and inclusion

The Group places great importance on fostering a corporate culture of Diversity, Equity and Inclusion (DEI). To reinforce and solidify these important values, we have corresponding policies in our Staff Handbook and have implemented practical measures regarding DEI. We are committed to equal employment opportunities for all staff and ensuring a fair and transparent recruitment process while also continuously working to increase the proportion of women in management roles.

Employee feedback is crucial for us in shaping a diverse and inclusive work environment. We conduct satisfaction surveys twice a year, allowing employees to provide feedback on the performance of our human resources and administrative departments. Furthermore, we strictly adhere to legal provisions guaranteeing employees’ rights to collective bargaining and freedom of association. Our employees are encouraged to join the company’s union, which currently has over 1,700 members.

To ensure equity and justice for all employees, we have established a multi-tiered Administrative Team to facilitate communication and coordination between levels. We have also set up a review panel to address employee grievances, which includes members from human resources, the complainant’s supervisor, and three individuals who are at the same level as the supervisor and responsible for the department that has a working relationship with the complainant. The panel is tasked with providing a fair and balanced assessment of any complaints, thereby maintaining a just and inclusive work environment for all.

Contributing a Positive Impact to Our Society

We are acutely aware that a key driver of sustainable development is the fulfilment of social responsibility. Therefore, the Group has been dedicatedly engaged in various initiatives to foster sustainable growth and address societal needs, bringing a positive impact on the communities where we operate our businesses. Looking ahead, we will continue to leverage our corporate strengths to participate in charitable events.

Promoting sports and active lifestyles

Xtep is committed to enhancing social welfare and actively investing in the communities we serve. We inject vitality and promote healthy living through strategic initiatives such as sponsoring marathon events which encourage residents to embrace active lifestyles via recreational running. We also develop innovative running products, empowering athletes with upgraded performance products and making an active lifestyle even more enjoyable.

Xtep Running Clubs (XRCs)
In response to the rising health awareness and the burgeoning running trend in Mainland China, we have expedited the establishment of Xtep Running Clubs (XRCs), creating value for over two million members of the Xtep Runners Club. As of 31 December 2023, there were 65 XRCs spread across Mainland China.

Our clubs aim to integrate running into people’s daily busy routines, providing professional services that facilitate and enrich the running experience. The XRCs are integral to Xtep’s running ecosystem, offering comprehensive professional running services that include consultations, support for running groups, and facilities for mobile device charging, baggage storage, and showers.

Running event sponsorship
We recognise the transformative power of sports in bringing communities together and enhancing individual wellbeing. Sponsoring large-scale running events like marathons is central to our mission of promoting healthy and vibrant societies. Emerging from the pandemic, these events took on new meaning — reconnecting communities while encouraging physical activity and mental resilience. Throughout 2023, we proudly sponsored 24 physical marathons in Mainland China.

Donations and Charity Events

At Xtep, we are committed to operating responsibly and giving back to the communities in which we operate. We actively seek to better our communities by cultivating a culture of civic engagement and participation. The Group conscientiously invest resources into impactful community initiatives by partnering with local charitable organisations and encouraging employee volunteering. In 2023, we have contributed sportswear and financial donations exceeding RMB77 million to various community programmes.

3 The reported turnover rates excludes the factory piecework employees.
4 Work-related injuries reported refer to cases reported to the local Human Resources and Social Security Bureau for an occupational injury assessment. The lost day figure reported is the aggregate of the work-related injury leave periods indicated by the assessments.
5 Included employees who left the Group during the reporting period.

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